The GPT Group says its European business, GPT Halverton, is eyeing acquisition opportunities in the UK.
The Australian property investor said GPT Halverton had not invested in the UK market for the past three years as it was unsustainably priced and had instead concentrated on continental Europe.
However, following the downturn in the UK market, GPT said it was beginning to see value returning to UK property.
Chief operating officer Michael O’Brien said: “Although GPT’s business has not invested in the UK, changing conditions in this market provide potential opportunities which, combined with the businesses’ existing activities and platform in Europe, stand the group in good stead to access steady growth over time as these businesses mature.”
GPT Group bought UK-based Halverton Real Estate Investment Management in July 2007.
In its full year results to 31 December the group said European assets under management grew to AUS$3.4bn (£1.6bn) as a result of the purchase of Halverton – the company’s first venture into Europe. Halverton operates six funds in continental Europe and is currently marketing its Northern European Light Industrial Fund.
Pretax profit fell 14% to $1.2bn following a lower increase in the value of its investment properties during the year.
However, it said underlying earnings per share grew 7% to 29.4c and it was in a strong financial position with gearing at 36%.
The company added it would also look to reduce its exposure to its joint venture with fund manager Babcock & Brown, established in 2005. The jv owns £3.3bn of assets in continental Europe – particularly Germany – and the US.
GPT said its return on equity reached 9.9% during the period, above the target of 9.7%, but it was in discussions with B&B to accelerate the return of capital and reduce its risk in the venture.
“It has become clear over the six months that capital and debt markets have changed dramtically,” said Neil Tobin, general manager of the joint venture.
“Recognising this fact, GPT and Babcock & Brown have agreed to respond proactively and collaboratively.”
GPT Group has total assets of $14bn (£6.6bn), 70% of which are in Australia.
